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Gold prices fell by 2% during Friday trading sessions, pressured by rising energy costs and inflation concerns that reinforced expectations of sustained tight monetary policy. The US dollar index climbed 0.3% to 99.11, marking over 1% weekly gains. Precious metals like silver and platinum also declined sharply, with silver futures dropping 5.5%. The market is now closely watching the upcoming US-China summit for potential policy signals.
The dollar's strength against gold highlights the inverse relationship between the two assets. Higher energy prices and inflation fears are pushing investors toward the dollar as a safe-haven asset, reducing demand for non-yielding gold. Central bank policies, particularly the Federal Reserve's stance on interest rates, will be critical in determining the dollar's trajectory and its impact on gold prices.
For traders, the key focus will be on the Fed's next monetary policy decisions and the outcome of the US-China summit. Energy price movements and inflation data from major economies will also influence precious metals. Investors should monitor the dollar index and central bank statements for directional clues in the coming weeks.
